Buyout firm Cove Hill Partners closes $1 billion fund

(Reuters) - Cove Hill Partners, a recently formed private equity firm founded by a former Bain Capital executive, said on Thursday it closed its first private equity fund with more than $1 billion in commitments.

The fund was financed by a broad base of investors, including families, university endowments and charitable foundations, and also received contributions from its founders, it said in a press release.

Launched this year, Cove Hill was founded by Andrew Balson, who previously spent 17 years at buyout firm Bain Capital.

Cove Hill will invest in consumer and technology companies valued between $100 million and $800 million, including debt, Balson said. It will focus on longer term investments with an average duration of eight or nine years, but, in some cases lasting as long as 15 years.

When Balson left Bain five years ago, he had the idea to set up a long-term fund but ended up joining an education startup called MatchBeyond. He starting fundraising for Cove Hill in March.

Although most longer-duration private equity funds generate lower returns than other private equity peers, Cove Hill will aim for returns in the top 25 percent of all private equity firms, he said.

Balson, who has been on the board of Domino’s Pizza (DPZ.N) for 19 years, said he wants to replicate the long-term success of Domino’s at other companies.

”We are very interested in working with our portfolio companies to utilize technology, data and new marketing techniques to grow their businesses and create a competitive advantage,” Balson said.

Another founding member, Justin Roberts, formerly of General Catalyst and THL Partners, will serve as managing director and co-lead of technology investing.